(Yicai Global) Feb. 26 -- China's version of TikTok, Douyin, is moving the headquarters of its e-commerce business to Shanghai from Beijing to get closer to the country’s e-retailing hubs, online tech media 36Kr reported today.

The popular short video platform, which has recently been turning to e-retailing to monetize its internet traffic, employs around 2,500 people in its e-commerce team. Two thousand of these are responsible for products and operations, and 500 are in charge of research and development. For those employees not willing to transfer to Shanghai, the firm will try to offer them different posts in Beijing, it said.

Operator ByteDance Technology said last year it would triple its workforce at its Shanghai office to 20,000 from 6,000. It also said that it would integrate the e-commerce channels of its Shanghai businesses, which include popular teen karaoke app Musical.ly and a video gaming team it recently purchased, with Douyin’s e-business.

Shanghai’s preferential tax policies are the real reason for Douyin’s decision to relocate, a company insider told Yicai Global.

Douyin’s e-retail gross merchandise volume more than tripled last year from 2019 to CNY500 billion (USD77.3 billion). However, 70 percent of this came from third-party platforms such as Alibaba Group Holding’s Taobao and JD.com. Douyin’s own stores only contributed a small amount.

Douyin has said it aims to double its GMV to get closer to the market share held by the country's e-retailing giants.

Editor: Kim Taylor